Both Sides of the Table

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How to Configure Your Startup Team

Both Sides of the Table

I am fond of quoting that about 70% of my investment decision of an early-stage company is the team. But not anal if one founder who shares equity graciously with early employees who are treated as “co-founders” My idea startup team is heaving on tech personnel but also has strong product management.

Cofounder 388
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Revisiting Paul Graham’s “High Resolution” Financing

Both Sides of the Table

When I first read Paul Graham’s blog post on “High Resolution&# Financing I read it as a treatise arguing that convertible notes are better than equity. I talked about this in my social proof post where I gave some suggestions about how to get the early guys off of the fence. Photo credit: D. and not a min.

Finance 286
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Is Convertible Debt Preferable to Equity?

Both Sides of the Table

Convertible debt is an investment that “converts&# into equity in the future usually at a discount to your next funding round price and sometimes has a “cap&# (maximum price). Why many early-stage investors DO price rounds (e.g. prefer equity to convertible debt): If you’re an early stage investor (e.g.

Equity 319
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The Coming Brick Wall in Venture Capital & Why This is Good for US Innovation

Both Sides of the Table

With more competition in early-stage many VCs are investing smaller amounts at earlier stages. Some are going later stage to not miss out on hot deals. I call this “stage drift.&#. What I’ve started to observe is that we’re certainly headed for a bit of a brick wall for early-stage companies.

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Beware of Premature Merge Elation

Both Sides of the Table

I can save tons of development time and I think I can buy it for all equity. The only thing worse than your early-stage company buying another early stage company is you trying to pull off a merger of equals. If they’re early stage like you, they’re likely just dogs.

Merger 276
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What’s Really Going on in the VC Industry? What Does it Mean for Startups?

Both Sides of the Table

So even within the “alternative class&# our LPs are looking at other asset investment choices such as distressed buyout funds, private equity or hedge funds. There is also True Ventures that does early stage, seed investments. This is producing a “boomlet&# or a bubble in early-stage investing.

LP 311
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Further Thoughts on Startup Operations

Both Sides of the Table

I recently wrote a post about why I didn’t think early-stage startups should have COOs. Dilute your cash, equity or both. In summary, tons of early-stage M&A is driven by only one thing: CEO ego. I expected it to be controversial and it was. Lead to bad blood on your existing team.